China drops WTO case asking to be granted ‘market economy’ status

The move will allow the US and EU to continue imposing levies on Chinese goods

Chinese manufacturing machinery (AP)

Chinese manufacturing machinery (AP)

TAIPEI (Taiwan News) – China is reported to have dropped the case at the World Trade Organization (WTO) over its claim to be recognized as a market economy, which means it will have to accept continued U.S. and EU anti-dumping duties on its cheap goods.

A WTO official familiar with the case revealed that Beijing decided to pull the suit because it has "lost so much that (it) doesn’t want the world to see the panel’s reasoning,” wrote Reuters.

The development would mean that the US and EU are allowed to continue imposing levies on cheap Chinese exports while at the same time dismissing Beijing’s claim that the products are reasonably priced, the report said.

The EU and US assert that the price of Chinese goods cannot be taken at face value since the government is known to interfere in the economy, which renders China unfit to be called a “market economy.” Beijing has resorted to legal action and insisted that it receive recognition as a market economy, citing the terms of its 2001 WTO membership agreement that grant it the status after 15 years in the organization, Reuters said.

The claim has been rebutted by the US and EU, which maintain that Chinese products such as steel and aluminum are still underpriced due to state subsidies. Chinese exporters have thus benefited from an unfair advantage, wrote the report.